-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, FtrSGav39gnXyTYgJFIQd7EMl0hwRA2GT40CwOuFXS1+KyJLMN/8VKgU6AF9nDrA zv+BnIzQ0Zjgsd36LO8x1A== 0001157523-03-000484.txt : 20030227 0001157523-03-000484.hdr.sgml : 20030227 20030227095356 ACCESSION NUMBER: 0001157523-03-000484 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20030226 ITEM INFORMATION: FILED AS OF DATE: 20030227 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TREX CO INC CENTRAL INDEX KEY: 0001069878 STANDARD INDUSTRIAL CLASSIFICATION: LUMBER & WOOD PRODUCTS (NO FURNITURE) [2400] IRS NUMBER: 541910453 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-14649 FILM NUMBER: 03581997 BUSINESS ADDRESS: STREET 1: 20 CAMERON ST CITY: WINCHESTER STATE: VA ZIP: 22801 BUSINESS PHONE: 5406784070 MAIL ADDRESS: STREET 1: 20 CAMERON ST CITY: WINCHESTER STATE: VA ZIP: 22801 8-K 1 a4346497.txt TREX 8K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 ----------------------------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): February 26, 2003 TREX COMPANY, INC. ------------------------------------------------- (Exact Name of Registrant as Specified in Charter) Delaware 001-14649 54-1910453 (State or Other Jurisdiction of (Commission File Number) (IRS Employer Incorporation) Identification No.) 160 Exeter Drive Winchester, Virginia 22603-8605 (Address of Principal Executive Offices) (ZIP Code) Registrant's telephone number, including area code: (540) 542-6300 Not Applicable ------------------------------------------------- (Former Name or Former Address, if Changed Since Last Report) Item 9. Regulation FD Disclosure. On February 26, 2003, Trex Company, Inc. (the "Company") issued a press release announcing financial results for the quarter and full year ended December 31, 2002. A copy of the February 26 press release is attached hereto as Exhibit 99.1 and incorporated herein by reference. The information in this Current Report on Form 8-K, including the exhibit, is furnished pursuant to Item 9 and shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. TREX COMPANY, INC. Date: February 26, 2003 /s/ Robert G. Matheny ----------------------------------- Robert G. Matheny President EXHIBIT INDEX ------------- Exhibit Number Exhibit Description - -------------- -------------------- 99.1 Press release dated February 26, 2003 EX-99 3 a4346497_ex99-1.txt TREX EXHIBIT 99.1 Exhibit 99.1 Trex Company Reports 2002 EPS Growth of 81 Percent WINCHESTER, Va.--(BUSINESS WIRE)--Feb. 26, 2003--Trex Company, Inc. (NYSE: TWP), manufacturer of Trex(R)decking and railing, today announced operating results for the quarter and fiscal year ended December 31, 2002. Fully diluted earnings per share for 2002 were $1.16, up 81 percent from the EPS of $0.64 recorded in 2001. In the fourth quarter, revenue increased 15 percent to $19.6 million, from $17.1 million in the fourth quarter of 2001. The company had a loss from operations of $1.7 million, versus a loss of $2.3 million in the corresponding quarter of 2001. Net loss for the fourth quarter was $1.4 million, or $0.10 per diluted share, compared to a loss of $2.3 million, or $0.16 per diluted share, for the fourth quarter of 2001. The company typically reports a loss in the fourth quarter due to the seasonal nature of deck installations. For the full year, the company reported record revenues of $167.1 million, a 43 percent increase over the $116.9 million reported in 2001. Income from operations doubled compared to the prior year, increasing to $34.5 million from $17.1 million. Net income was $16.8 million, an increase of 85 percent over the net income of $9.1 million recorded in 2001. "We have been surprised by the relatively strong demand during our slow winter season," said President Robert Matheny. "As a result, we have exceeded our prior guidance for both revenue and earnings. We now have all 17 of our installed production lines in operation, as we focus on supplying Trex for the 2003 spring season." The market for decking materials is highly seasonal, with peak periods occurring from late winter through September. As a result, the fourth quarter of every year is generally the company's weakest period in terms of sales. During this period, Trex Company builds product inventory to prepare for the heavy demand anticipated during the upcoming peak season. This operating strategy helps the company realize the efficiencies of a steady pace of year-round production. 2002 Operating Highlights: - The company refinanced the majority of its outstanding debt with $40 million of senior secured notes and $12.6 million of borrowings under new real estate loans. In connection with the refinancing, the company replaced its existing $17 million revolving credit facility with a $20 million revolving credit facility with a new lender. By refinancing this debt, Trex Company eliminated the former lender's conditional right to purchase 353,778 shares of common stock at $14.89 per share. - Manufacturing utilization was improved from 40 percent, running six production lines at the beginning of the year, to full production, running all 15 previously installed production lines as well as 2 lines that were installed in the later part of 2002. - The new plastic recycling plant in Winchester entered its start-up phase in December. This Winchester plant and the jointly owned recycling plant in Spain are key elements of a comprehensive sourcing strategy to ensure the availability of raw materials required to satisfy continued long-term growth. - The company had a number of successful new product introductions, including a new color, "saddle," and a code-listed 4x4 railing post, enabling construction of total-Trex decking and railing installations. - Trex Company won the Golden Hammer Communications Award for the second year in a row. The award, sponsored by Home Channel News and ProDealer Magazines, recognizes excellence in the area of "Home Improvement & Building Materials Communication," and is judged on how well a company has met its marketing goals. - Trex Company was ranked #43 by Bloomberg Personal Finance Magazine for share price appreciation for the one-year period from 11/01/01 to 10/31/02. The ranking was published in the Feb. 2003 issue. Trex Company's total return was 107 percent. Matheny continued, "2002 was an outstanding year for Trex Company, both operationally and financially. We have successfully addressed capacity and financial issues that surfaced in 2001, and are now benefiting from improved capacity utilization and absorption of fixed manufacturing overhead. We expect 2003 to be another good year for Trex. The expectation for first half 2003 revenue is between $112 million and $118 million, which would result in first half income of from $0.97 to $1.01 per diluted share. About Trex Company Trex Company is the nation's largest manufacturer of non-wood decking, which is marketed under the brand name Trex(R). Trex Wood-Polymer(R) lumber offers an attractive appearance and the workability of wood without the ongoing need for protective sealants or repairs. Trex decking and railing is manufactured in a proprietary process that combines waste wood fibers and reclaimed polyethylene and is used primarily for residential and commercial decking. The Company sells its products through approximately 90 wholesale distribution locations, which in turn sell Trex decking to approximately 2,900 independent contractor-oriented retail lumberyards across the United States. For a Trex decking and railing dealer near you, call 1-800-BUY-TREX (289-8739) or for dealers and product details, visit www.trex.com. Trex(R), Trex Easy Care Decking(R)and Trex Wood-Polymer(R)are trademarks of Trex Company, Inc., Winchester, Va. Note: The Company has scheduled an analyst conference call for 11:00 a.m. EST on Feb. 27. A live webcast of the conference call will be available to all investors at the Trex Company web site at www.trex.com. The call will also be simulcast at www.streetevents.com. For those who cannot listen to the live broadcast, an audio replay of the call will be available on these web sites for 30 days. A telephone replay of the call will also be available through March 6. To listen to the telephone replay, dial 888-266-2081 (703-925-2533 outside the U.S.) and enter passcode 6418312. The statements in this press release regarding the Company's expected sales performance and operating results, its projections of revenues and earnings, its anticipated financial condition and its business strategy constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements are subject to risks and uncertainties that could cause the Company's actual operating results to differ materially. Such risks and uncertainties include the extent of market acceptance of the Company's products, the sensitivity of the Company's business to general economic conditions, and the highly competitive markets in which the Company operates. The Company's report on Form 10-K filed with the Securities and Exchange Commission on March 21, 2002 discusses some of the important factors that could cause the Company's actual results to differ materially from those expressed or implied in these forward-looking statements. The Company expressly disclaims any obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.
Trex Company, Inc. Condensed Consolidated Statements of Operations (In thousands, except share date) (unaudited) Three Months Ended Twelve Months Ended December 31, December 31, 2001 2002 2001 2002 -------------------------------------------- Net sales $17,069 $19,637 $116,860 $167,079 Cost of sales 12,219 11,700 67,973 90,479 -------------------------------------------- Gross profit 4,850 7,937 48,887 76,600 Selling, general and administrative expenses 7,199 9,645 31,801 42,150 -------------------------------------------- Income (loss) from operations (2,349) (1,708) 17,086 34,450 Interest expense, net (2,142) (766) (3,850) (7,782) -------------------------------------------- Income (loss) before taxes (4,491) (2,474) 13,236 26,668 Income taxes (2,196) (1,070) 4,186 9,891 -------------------------------------------- Net income (loss) ($2,295) ($1,404) $9,050 $16,777 ============================================ Fully diluted earnings (loss) per common share. ($0.16) ($0.10) $0.64 $1.16 ============================================ Weighted average fully diluted shares outstanding 14,154,487 14,175,329 14,182,457 14,481,234 ============================================
Condensed Consolidated Balance Sheets (In thousands, except share date) 31-Dec-01 31-Dec-02 --------- ----------- (unaudited) ASSETS Current assets: Cash and cash equivalents $-- $14,893 Trade accounts receivable 2,507 840 Inventories 33,168 22,429 Prepaid expenses and other assets 1,306 1,395 Income tax receivable 1,137 -- Deferred income taxes 1,946 2,269 --------- ----------- Total current assets 40,064 41,826 --------- ----------- Property, plant and equipment, net 137,223 133,570 Intangible assets, net 6,837 6,837 Other 513 1,323 --------- ----------- Total assets $184,637 $183,556 ========= =========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Trade accounts payable $9,495 $10,056 Accrued expenses 630 6,089 Income taxes payable -- 114 Other current liabilities 964 638 Current portion long-term debt 25,759 795 --------- ----------- Total current liabilities 36,848 17,692 --------- ----------- Deferred income taxes 7,800 9,915 Line of credit 12,153 -- Debt-related derivatives 1,381 2,773 Mortgages 15,196 14,401 Long-term debt 32,986 40,000 Debt discount (3,712) -- --------- ----------- Total liabilities 102,652 84,781 --------- ----------- Stockholders' equity: Preferred stock, $0.01 par value, 3,000,000 shares authorized; none issued and outstanding -- -- Common stock, $0.01 par value, 40,000,000 shares authorized; 14,155,083 and 14,297,711 shares issued and outstanding at December 31, 2001 and 2002 142 143 Additional capital 46,079 49,354 Retained earnings 36,620 53,397 Deferred compensation -- (2,400) Accumulated other comprehensive net loss (856) (1,719) --------- ----------- Total stockholders' equity 81,985 98,775 --------- ----------- Total liabilities and stockholders' equity $184,637 $183,556 ========= ===========
CONTACT: Trex Company, Inc., Winchester Robert G. Matheny, 540/542-6300 or Lippert/Heilshorn & Associates, New York John Nesbett/William Walkowiak, CFA, 212/838-3777 -----END PRIVACY-ENHANCED MESSAGE-----